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Louisiana personal spending growth has lagged since 2009

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Consumer spending in Louisiana grew slightly during the Great Recession but has lagged behind growth in other states since, according to federal data released Thursday (Aug. 7).
(NOLA.com | The Times-Picayune)

Consumer spending in Louisiana grew slightly during the Great Recession but has lagged behind growth in other states since, according to federal data released Thursday (Aug. 7).

It was the first time the Commerce Department has issued consumer spending data broken down by state. The data, from 1997 through 2012, reveals the nation's uneven recovery.

Louisiana was among only eight states where total personal spending rose from 2008 to 2009, at the height of the recession. That 1.1 percent increase was the nation's third-largest, tied with North Dakota and behind only Hawaii (6.7 percent) and West Virginia (1.8 percent). But the 3.5 percent increase from 2011 to 2012 was below that in 32 states including Florida, Georgia, Kentucky and Arkansas.

Personal spending rose from an average of $28,364 per person in 2007 to $31,995 in 2012, or from the nation's eighth-lowest to the 15th lowest, according to statistics from the Bureau of Economic Analysis.

From 2008 through 2012, Louisiana's personal spending growth was the nation's eighth-fastest and fourth in the South, said Stephen Moret, head of Louisiana Economic Development.

"Louisiana experienced growth 29.3 percent faster than the U.S. and 17.1 percent faster than the South in that time period," even though recovery spending from hurricanes Katrina and Rita peaked around 2009 and then fell off rapidly, he wrote in an email.

As a mostly rural state, he said, Louisiana has not seen the rapid price increases for housing seen after the recession in New York and other densely populated areas.

"Both of these are good things for Louisiana consumers, as they both resulted in lower costs than consumers here would have experienced in some other regions of our country. At the same time, these two factors resulted in lower reported personal consumption expenditures here compared to other regions of the U.S."

Moret said U.S. Bureau of Labor Statistics data shows that Louisiana's private-sector job growth ranks second best in the South and sixth best nationally since January 2008. "Additionally, our state currently has the second lowest unemployment rate in the South," he wrote.

Income is more important than spending, and Louisiana's per capita personal income has risen 86.9 percent since 1997 compared to 66.4 percent nationwide, said Dr. Anthony J. Greco, an economics professor at the University of Louisiana at Lafayette.

Why hasn't spending risen as quickly as income? "It might be just that we're saving more money," Greco said.